Allied activists: Insights from shareholder dialogue on environmental and social issues

Together with his colleagues Dr. Tanja Ohlson and Dr. Falko Paetzold, Prof. Emilio Marti has authored a paper that he will present and discuss with us in the current IBSS session. Drawing on social movement theory, the paper examines how the structural position of shareholders shapes the dialogue tactics they use to make companies more sustainable.

Based on an ethnographic study of the Federated Hermes SDG Engagement Equity Fund, Prof. Marti and his colleagues develop an empirically grounded model of allied activism. Allied activism occurs when actors who occupy an in-between position between companies and various stakeholder groups use their good access to companies (“allied”) to advance goals on which they are partially aligned with these stakeholders (“activism”).

Prof. Marti shows that the fund used its in-between structural position to refer to other stakeholders who were already actively advancing specific sustainability issues, and that these references changed how some companies perceived their stakeholder environment. His key insight is that shareholder dialogue can advance sustainability issues around which other stakeholders are already active—particularly in receptive companies—but should not be understood as a “silver bullet” capable of advancing all types of sustainability issues across all types of companies.

Prof. Marti’s contribution to research on shareholder activism lies in offering a less heroic account of the impact of shareholder dialogue. At the same time, he contributes to social movement research by theorizing allied activism as a form of activism that complements insider and outsider activism in influencing companies.

Emilio Marti is an associate professor at the Rotterdam School of Management, Erasmus University. He uses insights from organization theory and strategy research to analyze questions of corporate sustainability, with a particularly focus on sustainable investing. His research has been published in journals such as the Academy of Management Journal, Academy of Management Review or Organization Science. He currently serves as an Associate Editor for Business & Society and as a Senior Editor for Organization Studies.